Aspen Imposes New Limits on Short-Term Rentals as Housing Prices Soar

“The Aspen City Council this week approved strict regulations limiting short-term rentals and easing the process for developing affordable housing, concluding seven months of work to rein in a real estate market frenzy that has homes selling for as much as $6,000 a square foot,” according to an article by Jason Blevins in The Colorado Sun. To illustrate the impact of rising housing prices on the town, Blevins notes that “In the first five months of this year, 94 Aspen homes sold for a total of more than $1 billion.”

“The new legislation, which the five-member council approved unanimously in meetings on Tuesday and Thursday, will reduce the number of short-term rental permits, limit the number of annual home demolitions, rezone residential parcels to allow for higher density and impose fees on residential development to pay for workforce housing.”

Per the new rules, “Permits will be issued to individuals, not companies and permits will not transfer when a home sells. The new ordinance reduces permits outside downtown zones with hotels and condo lodging by 25% and raises STR fees by 15%.” It also “reduce[s] the percentage of Aspen homes used for short-term rentals to 8%, from 11%.”

Like other popular vacation towns, “For nearly half a century, end-of-the-road Colorado villages like Aspen, Crested Butte and Telluride have navigated the commodity-versus-community clash with all sorts of fees, caps and regulations meant to protect affordability and local culture. And nothing has really worked, with real estate prices climbing as demand grows and the supply of new homes stalls under the regulation.” As short-term rentals (STRs) proliferate in part thanks to platforms like Airbnb and VRBO and workers suddenly untethered from their jobs thanks to remote work flock to small towns, the city hopes limiting STRs will preserve more affordable workforce housing for locals who find it increasingly difficult to stay in their towns.

Phillip Supino, Aspen’s community development director, called the city’s land use code “an evolving document,” acknowledging the potential for unintended consequences while suggesting that the council stay open to future amendments and adjustments.